1. The case originated in an application (no.
43662/98) against the Italian Republic lodged with the Court under former
Article 25 of the Convention for the Protection of Human Rights and Fundamental
Freedoms (“the Convention”) by four Italian nationals, Giovanni,
Elena, Maria and Giuliana Scordino (“the applicants”), on 12 August 1998.

2. By a judgment of 17 May 2005 (“the principal
judgment”), the Court ruled that the interference with the applicants'
right to peaceful enjoyment of their possessions was incompatible with
the principle of lawfulness and that accordingly, there had been a violation
of Article 1 of Protocol No. 1 (see Scordino v. Italy (no. 3), no. 43662/98, § 101, and point 1
of the operative provisions, 17 May 2005).

3. Relying on Article 41 of the Convention, the
applicants claimed by way of pecuniary damage a sum corresponding to
the value of the land in issue less the compensation received at national
level, plus the value of the buildings erected on their land. They also
requested compensation for non-pecuniary damage. Lastly, they requested
reimbursement of the costs incurred before the national courts and the
costs of the proceedings in Strasbourg.

4. As the question of the application of Article
41 of the Convention was not ready for decision, the Court reserved
it and invited the Government and the applicants to submit, within three
months of the judgment becoming final, their written observations on
that issue and, in particular, to notify the Court of any agreement
they might reach (ibid. § 108, and point 2 of the operative provisions).

5. The principal judgment became final on 12 October 2005,
following rejection by the panel of five judges of the Grand Chamber
of the respondent Government's application for referral. The three-month
time-limit passed without any such agreement having been reached.

6. On 12 June 2006 the President of the Chamber
to which the subsequent proceedings had been assigned (point 2 c) of
the operative provisions of the principal judgment) decided to ask each
party to appoint an expert to assess the pecuniary damage and to submit
an expert report by 30 September 2006.

7. Only the applicants submitted an expert report within the
time-limit set. That report was transmitted to the Government.

8. On 8 November 2006 the Government filed a memorial.
The applicants responded to that memorial on 9 January 2007.

THE LAW

I. APPLICATION OF ARTICLE 46 OF THE
CONVENTION

9. Article
46 of the Convention provides:

“1. The High Contracting Parties undertake to
abide by the final judgment of the Court in any case to which they are
parties.

2. The final judgment of the Court shall be transmitted
to the Committee of Ministers, which shall supervise its execution.”

10. The
Court refers to its conclusion in its principal judgment (§§ 92-94
and §§ 98-102 of the principal judgment):

“The Court further notes that the constructive
expropriation mechanism generally enables the administration to circumvent
the established rules governing expropriation, with the risk, for the
parties concerned, of an unforeseeable or arbitrary result, regardless
of whether the situation is unlawful from the outset or subsequently
becomes unlawful.

In this connection, the Court notes that constructive
expropriation enables the administration to occupy land and to alter
it irreversibly, so that is deemed to be public property, without any
parallel formal decision declaring the transfer of ownership being adopted.
Where there is no decision formalising the expropriation and made at
the latest when the owner has lost all use of the property, the factor
which will make it possible to transfer the occupied property to public
ownership and to attain legal security is the finding by the court of
unlawfulness, amounting to a declaration of transfer of ownership. It
is a matter for the party concerned – who formally continues to be
the owner – to ask the competent court for a decision, finding, as
the case may be, unlawfulness accompanied by the construction of works
in the public interest, which conditions are required for the party
concerned to be retrospectively declared dispossessed of his property.

Having regard to these factors, the Court considers
that the constructive expropriation mechanism is not capable of ensuring
a sufficient degree of legal security.

...

In the instant case, the Court notes that in
applying the principle of constructive expropriation, the Italian courts
considered the applicants to have been dispossessed of their property
as of 13 January 1982, the conditions of the unlawfulness of the occupation
and the public interest in the building erected having been satisfied.
In the absence of a formal expropriation order, the Court considers
that this situation cannot be considered to be 'foreseeable' since it
is only by means of the final decision – the judgment of the Court
of Cassation – that the principle of constructive expropriation can
be deemed to have been actually applied and the land deemed to have
been acquired as public property. Consequently, the applicants did not
have “legal security” as regards the dispossession of their land
until 23 August 2002, the date on which the judgment of the Court of
Cassation was lodged with the registry.

The Court further notes that the situation in
issue has allowed the administration to take advantage of that occupation
of the land without title from the outset, having been deemed arbitrary
by the administrative court (see paragraph 14 above). In other words,
the administration was able to appropriate the land in breach of the
rules governing expropriation in good and due form and, inter alia, without compensation being paid to the parties
concerned.

As regards compensation, the Court notes that
retrospective application of the Finance Act (Law No. 662/1996) to the
present case had the effect of depriving the applicants of full reparation
for the damage sustained.

In the light of these considerations, the Court
is of the opinion that the interference complained of is incompatible
with the principle of lawfulness and has therefore violated the applicants'
right to peaceful enjoyment of their possessions.

Accordingly, there has been a violation of Article
1 of Protocol No. 1.”

11. The
violation of the applicants' right guaranteed under Article 1 of Protocol
No. 1 originates in a widespread problem arising out of the unlawful
conduct of the authorities, endorsed by the courts and tribunals in
terms of constructive expropriation, and which permits those same authorities
to appropriate the property in question. The breach of the principle
of lawfulness and of the right to peaceful enjoyment of possessions
has not been caused by an isolated incident; neither is it attributable
to the particular turn taken by events in the case of the parties concerned.
It arises from application of the principle of constructive expropriation,
a principle established by judicial precedent and subsequently codified,
to a specific category of citizen, namely, the owners of land occupied
unlawfully from the outset or from a given point in time (see §§ 30-60
of the principal judgment).

In
the Court's view, the facts of the case disclose the existence, within
the Italian legal order, of a shortcoming as a consequence of which
an entire category of individuals have been or are still being arbitrarily
deprived of their right to the peaceful enjoyment of their possessions.
It also finds that the legal loopholes detected in the applicants' particular
case may subsequently give rise to numerous well-founded applications.

12. Before
examining the claims for just satisfaction submitted by the applicants
under Article 41 of the Convention, and having regard to the circumstances
of the case and the evolution of its caseload, the Court will examine
what consequences may be drawn from Article 46 of the Convention for
the respondent State. It reiterates that, under Article 46, the High
Contracting Parties undertake to abide by the final judgments of the
Court in any case to which they are parties, execution being supervised
by the Committee of Ministers. One of the effects of this is that where
the Court finds a violation, the respondent State has a legal obligation
not just to pay those concerned the sums awarded by way of just satisfaction
under Article 41, but also to select, subject to supervision by the
Committee of Ministers, the general and/or, if appropriate, individual
measures to be adopted in their domestic legal order to put an end to
the violation found by the Court and to redress as far as possible the
effects. The respondent State remains free, subject to monitoring by
the Committee of Ministers, to choose the means by which it will discharge
its legal obligation under Article 46 of the Convention, provided that
such means are compatible with the conclusions set out in the Court's
judgment (see Scozzari and Giunta v. Italy [GC], nos. 39221/98 and 41963/98,
§ 249, ECHR 2000-VIII and Broniowski v. Poland [GC], no. 31443/96, § 192, ECHR 2004-V).

13. Furthermore,
under the Convention, particularly Article 1, in ratifying the Convention
the Contracting States undertake to ensure that their domestic law is
compatible with the Convention (see Maestriv. Italy [GC], no.
39748/98, § 47, ECHR 2004-I).

14. The violation that the Court has found in
the present case arises from a situation affecting a large number of
people, namely, the category of individuals whose land has been occupied
unlawfully, and who could lose their property as a result of a court
decision endorsing the unlawful conduct of the authorities in terms
of constructive expropriation. There are already dozens of similar applications
before the Court. On 30 May 2000, the Court gave its first ruling on constructive
expropriation (see Carbonara and Ventura v. Italy, no. 24638/94, ECHR 2000-VI and Belvedere Alberghiera
S.r.l. v. Italy, no. 31524/96, ECHR 2000-VI). In 2003 it set out
the criteria applicable to just satisfaction in cases of constructive
expropriation (see Carbonara and Ventura v. Italy (just satisfaction), no. 24638/94,
11 December 2003 and Belvedere Alberghiera S.r.l. v. Italy (just satisfaction),
no. 31524/96, 30 October 2003). Since then, the Court has delivered many
judgments finding a violation of Article 1 of Protocol No. 1 as a result
of dispossession of property by way of constructive expropriation. That
is not only an aggravating factor as regards the State's responsibility
under the Convention for a past or present situation, but is also a
threat for the future effectiveness of the system put in place by the
Convention.

15. In
theory it is not for the Court to determine what may be the appropriate
measures of redress for a respondent State to take in accordance with
its obligations under Article 46 of the Convention. However, having
regard to the systemic situation which it has identified, the Court
would observe that general measures at national level are undoubtedly
called for in the execution of the present judgment, measures which
must take into consideration the large number of people affected. Furthermore,
the measures taken must be such as to remedy the systemic defect underlying
the Court's finding of a violation, so that the system established by
the Convention is not compromised by a large number of applications
arising out of the same cause. Such measures must therefore include
a mechanism for providing injured persons with compensation for the
violation of the Convention established in the present judgment concerning
the applicants. In that connection, the Court's concern is to facilitate
the rapid and effective suppression of a malfunction found in the national
system of human rights protection. Once such a deficiency has been identified,
the national authorities have the task, subject to supervision by the
Committee of Ministers, of taking - retrospectively if necessary - (see
the judgments in the cases of Bottazzi v. Italy [GC], no. 34884/97, § 22, ECHR 1999-V, Di Mauro v. Italy [GC], no. 34256/96, § 23, ECHR 1999-V, and
the Interim Resolution of the Committee of Ministers ResDH(2000)135
of 25 October 2000 (Excessive length of judicial proceedings in Italy:
general measures); see also Brusco v. Italy (dec.), no. 69789/01, ECHR 2001-IX, and Giacometti and Others v. Italy (dec.), no. 34939/97, ECHR 2001-XII),
the necessary measures of redress in accordance with the principle of
subsidiarity under the Convention, so that the Court does not have to
reiterate its finding of a violation in a long series of comparable
cases.

16. In
order to assist the respondent State in complying with its obligations
under Article 46, the Court has attempted to indicate the type of measures
the Italian State could take in order to put an end to the systemic
situation found in the present case.

It
considers that the respondent State should, above all, take measures
to prevent any unlawful occupation of land, whether this be unlawful
occupation from the outset or occupation that has initially been authorised
and which has subsequently become unlawful. This might be achieved by
authorising the occupation of such properties only where it was established
that the expropriation project and decisions had been adopted in accordance
with the rules laid down by law and that the necessary budgetary funds
had been earmarked to ensure that the persons concerned received prompt
and adequate compensation (for the principles applicable as regards
compensation in the case of expropriation in good and due form, see Scordino v. Italy (no. 1) [GC], no. 36813/97, §§ 93-98, ECHR
2006-). Furthermore, the respondent State should discourage practices
which are incompatible with the rules of expropriation in good and due
form, by adopting dissuasive provisions and by holding liable those
responsible for such practices.

In
all cases where land has already been occupied unlawfully and has been
altered in the absence of a declaration of expropriation, the Court
considers that the respondent State should remove the legal obstacles
which systematically and in principle prevent restitution of the land.
Where restitution is not possible for plausible concretereasons, the respondent State should effect payment of a sum
corresponding to the value of the restitution. Furthermore, the State
should take adequate budgetary measures to award, if necessary, damages
for any loss incurred and which are not covered by the restitution or
the payment in lieu (see paragraphs 25-39 below).

II. APPLICATION OF ARTICLE 41 OF
THE CONVENTION

17. Article 41 of the Convention provides:

“If the Court finds that there has been a violation
of the Convention or the Protocols thereto, and if the internal law
of the High Contracting Party concerned allows only partial reparation
to be made, the Court shall, if necessary, afford just satisfaction
to the injured party.”

A. Pecuniary damage

1. Applicants' submissions

18. The applicants asked the Court to award them
just satisfaction in accordance with the case-law concerning constructive
expropriation (Carbonara and Ventura v. Italy (just satisfaction), no. 24638/94,
11 December 2003 and Belvedere Alberghiera S.r.l. v. Italy (just satisfaction),
no. 31524/96, 30 October 2003). They claimed that only restitution of the
land could place them in a situation equivalent to their original situation.
In the absence of restitution, the applicants requested full compensation,
less any amount that they had received at national level, and claimed
an amount covering the current value of the land plus the appreciation
brought about by the existence of the buildings, and loss of enjoyment.

19. In support of their claims, the applicants
produced an expert report, prepared by three experts. The estimate relates
to land measuring 3,694 square metres, situated a few kilometres from
the town centre of Reggio de Calabria, in an area earmarked for and
undergoing urban development.

The report notes that in 1980, the year in which
the land was occupied, the land occupancy volume (indice di fabbricabilità) rose from 1.75 cubic metres per
square metre to 3.15 cubic metres per square metre. Two buildings comprising
thirty housing units and garages were built, with a volume of 13,338
cubic metres.

The experts determined the current value of the
land to be 1,329,840 euros (EUR) (EUR 360 per square metre), based on
today's property market.

They then considered the appreciation brought
about by the existence of the buildings used for residential purposes.
This appreciation, less the value of the land, amounted to EUR 2,476,067.

Furthermore, the experts indicated that the cost
of constructing the buildings in 2006, less 17% for wear and tear of
the buildings, less the value of the land, also totalled EUR 2,476,067.

The experts then assessed the damage for loss
of enjoyment due to it not having been possible to use the land and
the buildings for more than twenty-four years. This damage amounted
in total to EUR 4,179,653.50.

20. To summarise the experts' conclusions:

Value of the land in 2006:

EUR
1,329,840

Appreciation brought about by the existence of the buildings = cost
of construction in 2006, less wear and tear:

EUR 2,476,067

Inability to enjoy the land and buildings:

EUR 4,179,653,50

2. The Government's submissions

21. The Government failed to produce a second
expert opinion. They made no comments on the legitimacy and accuracy
of the calculations presented in the applicants' expert report.

22. In their memorial, the Government contested
the Court's case-law concerning just satisfaction for arbitrary dispossession
of property, on which case-law the applicants based their claims.

The Government considered that the Papamichalopoulos judgment constituted an erroneous precedent,
both legally and financially: they claimed that there was confusion
between the value of the buildings, the cost of construction and the
appreciation brought about by the existence of the buildings. Moreover,
the Government contended that obliging a State to return land – including
the buildings that had been erected on that land – amounted to enrichment
for the party concerned, who would thus obtain the State's investment
free of charge.

The Government then criticised the judgment in
the case of Carbonara and Ventura, in so far as the applicant was awarded
an amount corresponding to the cost of building the school built by
the authorities. Lastly, they observed that in the Belvedere Alberghiera case, where the land had been used for
the construction of a road, the Court had not awarded an amount corresponding
to the cost of construction of the road but an amount for loss of value
of the building due to the construction of the road.

23. In conclusion, the Government found this case-law
to be inconsistent and asked that the Court abandon it.

24. The Government asked the Court to adopt new
criteria and thus award the interested parties just satisfaction limited
to the market value of the land at the time of its alteration, increased
by the rate of inflation over the period concerned plus interest. In
support of their argument, the Government asserted that a decision by
which the national courts found that the authorities had acted unlawfully
had the effect of legalising the situation since it took the place of
the missing expropriation order. Consequently, the interested parties
could not seek compensation, since this was reserved for cases of arbitrary
expropriation.

3. The Court's decision

25. The Court reiterates that a judgment in which
it finds a breach imposes on the respondent State an obligation to put
an end to the breach and make reparation for its consequences in such
a way as to restore as far as possible the situation existing before
the breach (see Iatridis v. Greece (just satisfaction) [GC], no. 31107/96, §
32, ECHR 2000-XI).

26. The Contracting States that are parties to
a case are in principle free to choose the means whereby they will comply
with a judgment in which the Court has found a breach. This discretion
as to the manner of execution of a judgment reflects the freedom of
choice attaching to the primary obligation of the Contracting States
under the Convention to secure the rights and freedoms guaranteed (Article
1). If the nature of the breach allows of restitutio in integrum, it is for the respondent State to effect
it, the Court having neither the power nor the practical possibility
of doing so itself. If, on the other hand, national law does not allow
– or allows only partial – reparation to be made for the consequences
of the breach, Article 41 empowers the Court to afford the injured party
such satisfaction as appears to it to be appropriate (see Brumărescu v. Romania (just satisfaction) [GC], no. 28342/95,
§ 20, ECHR 2000-I).

27. In its principal judgment, the Court held
that the interference in issue did not satisfy the condition of lawfulness
(§§ 98-102 of the principal judgment). The act of the Italian Government
which the Court held to be in breach of the Convention was not in the
instant case an expropriation which would have been legitimate but for
the failure to pay adequate compensation; on the contrary, it was a
taking by the State of the applicants' land, for which the latter have
been unable to obtain redress (§§ 99-100 of the principal judgment).

In this regard, the Court has established that
the national courts noted the unlawful situation and that, by virtue
of that finding, they declared that the applicants had been dispossessed
of their possessions in favour of the occupant (§ 98 of the principal
judgment). Furthermore, the Court considered that despite the compensation
paid to the applicants, “full reparation of the loss incurred” had
not been made (§ 100 of the principal judgment).

28. It is apparent from the foregoing that the
Court acknowledged the applicants' status as “victims” in order to
then find a breach of Article 1 of Protocol No. 1 (see Eckle v. Germany, judgment of 15 July 1982, Series A no. 51, p.
32, §§ 69 et seq.; Amuur v. France, 25 June 1996, Reports of Judgments and Decisions 1996-III, p. 846, § 36; Dalban v. Romania
[GC], no. 28114/95, § 44, ECHR 1999-VI; and Jensen v. Denmark (dec.), no. 48470/99, ECHR 2001-X). Furthermore,
the applicants continue to be “victims” as their situation has remained
unchanged since the principal judgment was delivered.

29. The Court reaffirms that, in its view, the
decision by which a national court takes note of an illegal occupation
of land and declares constructive expropriation thereof does not have
the effect of regularising the situation complained of. It merely ratifies
an unlawful situation (see, among numerous judgments, Serrao v. Italy, no. 67198/01, § 81, 13 October 2005), a situation
which cannot be redressed where reparation is not made in accordance
with the criteria which apply to cases of unlawful deprivation of possessions.

30. Accordingly, the Court rejects the Government's
argument and reasserts that it is not possible to equate lawful expropriation,
which would be in breach of Article 1 of Protocol No. 1 by reason of
the inadequacy of the compensation, with a case such as the instant
case, where the violation of the applicants' right to enjoyment of their
possessions arises from on violation of the principle of lawfulness
(see Former
King of Greece and Others v. Greece (just satisfaction) [GC],
no. 25701/94, § 75, ECHR 2002)

It follows that reparation in cases of constructive
expropriation will not be similar to the compensation awarded for cases
in which the finding of a violation of Article 1 of Protocol No. 1 for
deprivation of possessions is based on the fact that the “fair balance”
was not struck given the level of compensation well below the market
value of the land and given the lack of “public interest” grounds
making it possible to pay expropriation compensation lower than the
value of the property (see Scordino v. Italy (no. 1) [GC], no. 36813/97, § 257, ECHR 2006-).

31. The compensation to be set in the instant
case must reflect the idea of total elimination of the consequences
of the impugned interference. In fact, in the present case, it is the
intrinsic unlawfulness of the taking of the land that was at the origin
of the violation found under Article 1 of Protocol No. 1. The unlawfulness
of such a dispossession inevitably affects the criteria to be used for
determining the reparation owed by the respondent State since the pecuniary
consequences of a lawful taking cannot be assimilated to those of an
unlawful dispossession (see Former King of Greece and Others, cited above, § 75 and Scordino v.
Italy [GC], cited above, § 250).

32. The
Court points out that its position as regards just satisfaction in cases
of arbitrary dispossession of possessions was based on the principles
laid down by the Permanent Court of International Justice (see Papamichalopoulos and Others v. Greece (Article 50), judgment
of 31 October 1995, Series A no. 330-B, § 36), which in its judgment of
13 September 1928 in the case concerning the factory at Chorzów, held:

“... reparation must, as far as possible, wipe
out all the consequences of the illegal act and re-establish the situation
which would, in all probability, have existed if that act had not been
committed. Restitution in kind, or, if this is not possible, payment
of a sum corresponding to the value which a restitution in kind would
bear; the award, if need be, of damages for loss sustained which would
not be covered by restitution in kind or payment in place of it –
such are the principles which should serve to determine the amount of
compensation due for an act contrary to international law.” (Collection
of Judgments, Series A no. 17, p. 47)

33. The Court adopted a very similar position
in Papamichalopoulos v. Greece (see Papamichalopoulos and Others v. Greece (Article 50), cited above,
§§ 36 and 39). It found a violation in that case on account of a de facto
unlawful expropriation (occupation of land by the Greek navy since 1967)
which had lasted more than twenty-five years on the date of the principal
judgment delivered on 24 June 1993. The Court accordingly ordered the
Greek State to pay the applicants, for damage and loss of enjoyment
since the authorities had taken possession of the land, a sum equivalent
to the current value of the land increased by the appreciation brought
about by the existence of certain buildings that had been built since
occupation.

34. The
Court followed that approach in two Italian cases concerning expropriations
that did not comply with the principle of lawfulness. In the first of
those cases, Belvedere Alberghiera S.r.l. v. Italy (just satisfaction), no.
31524/96, §§ 34-36, 30 October 2003), it held:

“As it is the inherent unlawfulness of the expropriation which was
at the origin of the breach found, the compensation must necessarily
reflect the full value of the property.

With regard to pecuniary damage, the Court therefore holds that the
compensation to be awarded to the applicant is not limited to the value
of the property when it was occupied. For that reason, it requested
the expert to estimate also the current value of the land in issue and
the other heads of damage.

The Court decides that the State shall pay the applicant the current
value of the land. To that amount shall be added a sum for loss of enjoyment
of the land since the authorities took possession of it in 1987 and
for the depreciation of the property. Furthermore, in the absence of
comments from the Government on the expert report, an amount shall be
awarded for loss of income from the hotel activity.”

35. In
the second of those cases, (see Carbonara and Ventura v. Italy (just satisfaction), no. 24638/94,
§§ 40-41, 11 December 2003), the Court declared:

“With regard to pecuniary damage, the Court therefore holds that the
compensation to be awarded to the applicants is not limited to the value
of their property when it was occupied. For that reason, it requested
the expert to estimate also the current value of the land in issue.
That value does not depend on hypothetical conditions, which would be
the case if it was now in the same condition as in 1970. It is clear
from the expert report that, since then, the land and its immediate
surroundings – whose situation gave them potential in terms of urban
development – have increased in value as a result of the construction
of buildings, including a school.

The Court decides that the State should pay the applicants, for damage
and loss of enjoyment since the authorities took possession of the land
in 1970, the current value of the land plus the appreciation gained
by the existence of the building.

As to the determination of the amount of that compensation, the Court
adopts the findings in the expert report for the exact assessment of
the damage sustained. That sum amounts to EUR 1,385,394.60.”

36. An
analysis of the three above-mentioned cases, which all concern cases
of inherently unlawful dispossession, shows that, in order to fully
compensate the loss incurred, the Court has awarded amounts taking account
of the current value of land in the light of today's property market.
It has also sought to compensate loss not covered by payment of that
amount, by taking account of the potential of the land in question,
calculated, if applicable, on the basis of the construction costs of
buildings put up by the expropriating authority.

37. Taking account of the foregoing considerations,
the Court believes that in the present case, the nature of the violation
found in the principal judgment enables it to adopt the principle of restitutio in
integrum. Consequently, the Court considers that the return of
the land in issue ... would put the applicants as far as possible in
a situation equivalent to the one in which they would have been if there
had not been a breach of Article 1 of Protocol No. 1; the award of the
existing buildings would then fully compensate them for the consequences
of the alleged loss of enjoyment (see Papamichalopoulos and Others v. Greece (Article 50), cited
above, § 36 and §38).

38. If such restitution is not made, the Court
considers that the compensation to be awarded to the applicants is not
limited to the value of their property on the date of occupation. It
decides that the State should pay to the parties concerned a sum corresponding
to the current value of the land (EUR 1,329,840), from which must be
deducted the compensation obtained by the applicants at national level
(namely, ITL 264,284,339 in 1982, see paragraph 25 of the principal judgment)
and updated (that is, approximately EUR 436,000). To this amount will
be added an amount for appreciation brought about by the presence of
buildings – which in the present case has been estimated at the same
level as the construction costs – and which is also capable of compensating
the applicants for any other loss they have incurred.

39. As to determination of the amount of this
compensation, in the absence of an expert report submitted by the Government
and in the absence of any comments on the amounts claimed, the Court
relies on the applicants' expert report. Ruling on an equitable basis,
the Court awards the applicants EUR 3,300,000.

B. Non-pecuniary damage

40. The applicants each claimed EUR 25,000.

41. The Government found these sums to be excessive
and left the matter to the discretion of the Court.

42. The Court considers that the violation of
the Convention has clearly caused the applicants non-pecuniary damage
arising out of a feeling of powerlessness and frustration in the face
of the unlawful taking of their property. Ruling on an equitable basis,
it awards each of the applicants EUR 10,000 under this head, or EUR 40,000
in total.

C. Costs and expenses

43. The applicants requested EUR 26,983.76 for
reimbursement of the costs incurred before the national courts. They
also sought reimbursement of the costs incurred before the Court totalling
EUR 51,891.44, including EUR 46,000 for fees, value added tax (VAT) and
social security contributions. The applicants did not seek reimbursement
of the expert's fees.

44. The Government observed that the amounts claimed
were excessive and left the matter to the discretion of the Court.

45. The Court reiterates that costs and expenses
will not be awarded under Article 41 unless they have actually been
incurred, were necessarily incurred and were also reasonable as to quantum
(see Iatridis
v. Greece (just satisfaction), cited above, § 54). Furthermore,
legal costs are only recoverable in so far as they relate to the violation
found (see Vande Hurk v. Netherlands, judgment of 19 April 1994, Series A no.
288, § 66).

46. The
Court does not doubt that the costs claimed were necessarily and actually
incurred. It considers that the applicants' case before the national
courts was intended essentially to redress the violations of the Convention
alleged before the Court. The Court deems however the total amount of
fees claimed in this respect to be too high. It therefore considers
that only partial reimbursement need be made.

Having regard to the circumstances of the case,
and ruling on an equitable basis as required under Article 41 of the
Convention, the Court deems it reasonable to award the sum of EUR 30,000
plus VAT and social security contributions in respect of all costs incurred
before the domestic courts and in Strasbourg.

D. Default interest

47. The Court considers it appropriate that the
default interest should be based on the marginal lending rate of the
European Central Bank, to which should be added three percentage points.

FOR THESE REASONS, THE COURT UNANIMOUSLY,

1. Holds

a) that the respondent State is to pay the
applicant, within three months from the date on which the judgment becomes
final, in accordance with Article 44 § 2 of the Convention, the following
amounts:

b) that from expiry of the above-mentioned
three months until settlement, simple interest shall be payable on the
above amounts at a rate equal to the marginal lending rate of the European
Central Bank during the default period plus three percentage points;

2. Dismisses the remainder of the claim for just satisfaction.

Done in French and notified in writing
on 6 March 2007 pursuant to Rule 77 §§ 2 and 3 of the Rules of Court